NZ’s Fonterra reports lower Q1 profit; raises milk price outlook on strong demand
4:03 pm Wednesday, December 04th, 2024
(Reuters) -Fonterra Co-operative reported a lower first-quarter profit after tax on Thursday, due to impacts from lower sales volume and higher milk prices, while raising its milk price outlook for the 2024/25 season on the back of sustained demand.
The New Zealand dairy firm reported a profit after tax of NZ$263 million ($154.12 million) for the quarter ended Oct. 31, down from NZ$346 million last year.
The company has raised the midpoint forecast for Farmgate Milk Price by 50 New Zealand cents to NZ$10.00 per kilogram of milk solids (kgMS), setting a new range between NZ$9.50 and NZ$10.50 per kgMS.
The adjustment comes on the heels of a recovery in demand from Greater China and sustained strong demand from Southeast Asia, the company said.
Separately, Fonterra maintained its earnings guidance for FY25 at 40-60 New Zealand cents per share.
“Our forecast earnings range reflects an expectation our underlying operating profit will be stable as we offset the higher cost of milk in the second half of the financial year through improved sales volumes, product mix and pricing,” said Fonterra CEO Miles Hurrell.
($1 = 1.7065 New Zealand dollars)
(Reporting by Adwitiya Srivastava in Bengaluru; Editing by Alan Barona)
